'Children help parents' high retirement costs'

Financial Adviser, 19th June 2008.

'Nearly a tenth - 1.7m - of British adults are stepping in to help their parents fund retirement as longevity and rising costs take their toll, research by the mutual insurer Engage has revealed.

Conducted among 2084 people, it showed that out of the 1.7m polled, 22 per cent have given money to their parents to help them make ends meet on day-to-day expenses, 22 per cent are paying towards their parent's care, and 33 per cent have taken their parents into their or a relative's home in order to reduce their costs of living and care.

The news comes as a report by Life Trust revealed over half of Britons - 54 per cent - were worried about their ability to finance their retirement if they were to live longer than 10 years after the official pensionable age.

Karl Elliott, spokesman for Engage Mutual Assurance, said pensioners were finding it increasingly difficult to make ends meet as the cost of living rose.

He said: "With the size of Britain's retired population growing, and costs of living increasing, it is important that people save little and often towards their retirement in order to reduce the pressure on themselves and their family to make ends meet in old age."

Andrea Rozario, director general for Ship, said figures such as these only serves to further show the need for products such as equity release.

She said: "You have many older people who are living in huge houses but can barely feed themselves. The demographic demand for equity release products can therefore only increase."'